China Crosses the Rubicon

by Wen Liao, The Moscow Times, June 19, 2009

For two decades, Chinese diplomacy has been guided by the concept of the country's "peaceful rise." Today, however, China needs a new strategic doctrine, because the most remarkable aspect of Sri Lanka's recent victory over the Tamil Tigers is not its overwhelming nature but the fact that China provided President Mahinda Rajapaska with both the military supplies and diplomatic cover he needed to prosecute the war.

Without that Chinese backing, Rajapaska's government would have had neither the wherewithal nor the will to ignore world opinion in its offensive against the Tigers. So not only has China become central to every aspect of the global financial and economic system, it has now demonstrated its strategic effectiveness in a region traditionally outside its orbit. On Sri Lanka's beachfront battlefields, China's peaceful rise was completed.

What will this change mean in practice in the world's hot spots like North Korea, Pakistan, and Central Asia?

Before the global financial crisis hit, China benefited mightily from the long boom along its eastern and southern rim, with only Burma and North Korea causing instability. China's west and south, however, have become sources of increasing worry.

Given economic insecurity within China in the wake of the financial crisis and global recession, China's government finds insecurity in neighboring territories more threatening than ever. Stabilizing its neighborhood is one reason why China embraces the six-party talks with North Korea, became a big investor in Pakistan, signed on to a joint Asia and Europe summit declaration calling for the release from detention of Burmese opposition leader Daw Aung Suu Kyi and intervened to help end Sri Lanka's 26-year civil war.

The calculus behind China's emerging national security strategy is simple. Without peace and prosperity around China's long borders, there can be no peace, prosperity and unity at home. China's intervention in Sri Lanka and its visibly mounting displeasure with the North Korean and Burmese regimes suggest that this calculus has quietly become central to the government's thinking

For example, though China said little in public about Russia's invasion and dismemberment of Georgia last summer, Russia is making a strategic mistake if it equates China's public silence with tacit acquiescence to the Kremlin's claim to "privileged interests" in the post-Soviet republics, many of which are located on China's western flank.

Proof of China's displeasure was first seen at the 2008 summit of the Shanghai Cooperation Organization. President Dmitry Medvedev pushed the SCO to recognize the independence of Abkhazia and South Ossetia, but the SCO balked. The group's Central Asian members -- Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan -- would not have stood up to the Kremlin without China's support.

At this year's SCO summit, which ended on Tuesday, the pattern continued. The brief appearance of Iran's disputed president-elect, Mahmoud Ahmadinejad, may have gained all the headlines, but China's announcement of a $10 billion fund to support the budgets of financially distressed former Soviet republics, which followed hard on a $3 billion investment in Turkmenistan and a $10 billion investment in Kazakhstan, provides more evidence that China now wants to shape events across Eurasia.

Prime Minister Vladimir Putin famously described the collapse of the Soviet Union as the greatest geopolitical catastrophe of the 20th century. From China's standpoint, however, the Soviet collapse was the greatest strategic gain imaginable. At a stroke, the empire that had gobbled up Chinese territories for centuries vanished. The Soviet military threat -- once so severe that Chairman Mao invited U.S. President Richard Nixon to China to change the Cold War balance of power -- was eliminated. China's new assertiveness suggests that it will not allow Russia to revive Soviet-like spheres of influence or undo the post-Cold War settlement under which China's economy flourished and security increased.

So far, China's rulers have regarded emerging strategic competition with India, Japan, Russia and the United States as a jostling for influence in Central and South Asia. China's strategic imperative in this competition is to ensure that no rival acquires a dangerous "privileged influence" in any of its border regions. Beijing also wants to maximize the protection of its trade routes -- not least of which are its sea lanes (hence China's interest in Sri Lanka and in combating Somali pirates).

In the 1990s, China sought to mask its "peaceful rise" behind a policy of "smile diplomacy" designed to make certain that its neighbors did not fear it. China lowered trade barriers and offered soft loans and investments to help its southern neighbors. Today, China's government seeks to shape the diplomatic agenda in order to increase China's options while constricting those of potential adversaries.

Instead of remaining diplomatically aloof, China is forging more relationships with its neighbors than any of its rivals. This informal web is being engineered not only to keep its rivals from coalescing or gaining privileged influence, but also to restrain the actions of China's local partners so as to dampen tension anywhere it might flare up.

Rather than creating fear, China's newfound assertiveness should be seen as establishing the necessary conditions for comprehensive negotiations about the very basis of peaceful coexistence and stability in Asia -- respect for all sides' vital interests. In recent years, such an approach ran counter to the U.S. foreign policy predisposition of favoring universalist doctrines over a careful balancing of national interests. With the administration of U.S. President Barack Obama embracing realism as its diplomatic lodestar, China may have found a willing interlocutor.

Wen Liao is chairwoman of Longford Advisors, a political, economic and business consultancy in Hong Kong.